Finance and Accounting
Product Cost Accounting
Finance must deliver timely, accurate decisions regarding product mix, pricing, marketing promotions, sourcing, and product launches to maintain customer loyalty, profit margins and expand market share. Genpact's product cost accounting solutions provide Fortune 500 companies with end-to-end oversight of the entire supply chain, from bill of material (BoM) setup, updates, and reviews to forecasting and budgeting, factory accounting and reconciliation, and reporting.
Genpact architects the Lean DigitalSM enterprise by combining design-thinking principles, and Lean approaches with digital technologies, analytics, and deep domain expertise.
Our product cost accounting solution enables us to design, transform, and run highly intelligent, advanced operating models for supply chain accounting and product costing that leverages our Digital Smart Enterprise Processes (SEPSM) framework to reimagine business outcomes.
We use a variety of agile, technologies for product cost accounting, including machine learning, natural language processing and artificial intelligence, to help organizations reduce volatility and control costs. These also include proprietary tools that our part of our System of EngagementTM F&A suite, an agile solution layer that integrates with an organization’s existing systems of record, that offer:
- Technologies to examine BoMs, rates of operations cost variances, and journal entries
- Web-based e-learning modules
- Preventive controls
- Expert audits
Pre-defined efficiency and effectiveness metrics hone processes, boost performance, and provide deep insight into product cost structures.
Our end-to-end product costing spans:
- BoM/material master management: Setup, update, validation, and review
- Forecasting, budgeting, and standard product costing: Demand forecasting, annual budget creation and updates, transfer pricing computation, ERP allocation rule updates, computation and updating of standard costs for existing and new products
- Factory accounting, period close, and reconciliation: Moving average price reviews, accruals booking for all manufacturing centers, review settlement of work orders, execution cost allocation cycles, cost of manufacturing accrual reconciliation, inventory reconciliation, and booking of period close journals
- Reporting and analysis: Inventory analysis (slow-moving, aging, obsolete, and cycle count) and cost analysis (standard vs. actual, change in standard costs, rate of operation analysis)
Genpact's product cost accounting solutions focus on delivering impact by linking key process drivers to desired business outcomes. The results are measurable and lasting:
Millions of revaluation and working capital impact from implementing a comprehensive BoM tool
A global manufacturer of tissue, personal care, and health care products needed to correct variances in inventory valuation to update standard BoMs and Rates of Operation based on actual cost trends. Genpact compared the inventory value of 170,000 materials with actual inventory at 50 mills, analyzing expense lines, base material costs, packing materials, utilities, and labor costs.
Over a million dollars savings through inventory analysis within three months
A global equipment manufacturer had no effective review and reporting mechanism for open purchase orders (POs) against slow-moving items. This resulted in a large number of open POs for a growing stock of inventory that was at risk of obsolescence. Genpact conducted a one-time cleanup of open items and created a review and reporting mechanism for future purchases to prevent recurrence of the problem. By cancelling or postponing open orders for slow-moving inventory, the company saved over $1 million within three months.